The world’s biggest telecom equipment maker, Huawei Technologies Co was sued by Cisco Systems in 2003 for allegedly infringing on its patents. In the US, security officials have accused it of allowing unauthorized access by the Chinese People's Liberation Army through its equipment. US political opposition forced Huawei to withdraw its purchase of 3Leaf systems in 2010.

British government departments "have scrapped" video conferencing equipment supplied by Chinese IT giant Huawei because of security concerns, it was claimed yesterday.

The Home Office, Ministry of Justice and Crown Prosecution Service are all said to have stopped using the devices during meetings amid fears that the devices could contain eavesdropping bugs.

According to a British Sunday newspaper, ministers "acting on specific intelligence" issued a top-level briefing ordering that all departments stop using the equipment.

The company has repeatedly denied having close links with the Chinese government. Last night a spokesman said that "the inaccurate" media reports were being taken seriously.

"We are looking into the possibility some equipment might have been sold to these departments through a third party but we have not sold such devices directly," the spokesman told the South China Morning Post.

Huawei, founded by a former PLA official Ren Zhengfei, has been banned from bidding for sensitive infrastructure contracts in the US and Australia.

The company has been active in the UK technology market since 2005 when it signed a multi-billion pound deal to provide networking equipment to British Telecom. It has been embraced by the UK coalition government and last year signed up to a number of lucrative contracts worth £125 million (HK$1.59 billion).

A Cabinet Office spokesman did not deny or back the media claims.

The former head of the Foreign Office's Asia research group, Roderic Wye told the Sunday Mirror "there had long been fears about the firm's operations".

He said: "It's a matter of record that the United States and Australia have had real concerns about Huawei. The UK has been rather more open and there is quite a bit of Huawei investment in this country.

"But there clearly remain concerns over how close the relationship is between Huawei and the Chinese government - and whether it could be a risk using the firm's technology in sensitive areas."

This article appeared in the South China Morning Post print edition as Huawei devices dropped amid security concerns